July 2, 2007

Michael D. Gallagher does not make video games. He doesn’t review them. He doesn’t sell them. But recently he became one of the most important people in the video-game industry and, by extension, a powerful shaper of the digital entertainment consumed by hundreds of millions of people around the world.

On June 1, Mr. Gallagher, 43, took office as president of the Entertainment Software Association, becoming the game industry’s chief lobbyist in Washington. [...]

[...] In that sense he reflects the political and cultural maturation of gaming. Three decades ago, when digital entertainment was in its infancy, games were played mostly by boys and young men. Many never stopped playing, and they now form a vanguard of lifelong gamers, some of whom are assuming positions of influence and power. Someday soon the United States might have a president who grew up playing video games.

AFTER 10 years, four books, a high-profile appeal to the Supreme Court, countless lectures and slide shows, Lawrence Lessig, a professor at Stanford Law School, announced last month on his blog (www.lessig.org) that he would no longer lead the fight to ease copyright restrictions in the Internet age.

Instead, Mr. Lessig plans to focus on something not quite so intractable — corruption in the American political system. And then, presumably, a good five-cent cigar.

Scam-baiters scam the scammer. They antagonize, humiliate and frustrate scammers who think they have an unwary victim. The baiters trade tips, tales and “trophies” on thriving discussion boards like those at 419eater.com, scamorama.com and aa419.org. (The 419 refers to the section of the Nigerian penal code that deals with fraud.)

“My reason for scam-baiting is to waste the time and resources of the scammer,” said a scam-baiter with the Web name of Scam Patroller, who declined to provide any identification beyond an e-mail address. “Each minute a scammer spends on my bait cannot be used to scam a real victim.”

Their motives may seem altruistic, but not all law enforcement officials approve of their tactics, which can include entrapment and public humiliation. Many of the scam-baiters succeed in getting embarrassing photographs of their targets posted on the Internet.

“At first you might smile and think the trophy photographs are funny, but I have seen some with fraudsters in highly degrading positions,” said Ralf Zimmermann, a crime intelligence officer in the financial and high-technology crimes division of Interpol, based in Lyon, France. “They are fraudsters and they are not good people, but they have their human rights.”

Jeff Price, the founder and chief executive of TuneCore, a digital music distributor, has a simple pitch for musicians: “For $30, the cost of a pizza and a six-pack, you can get your album on iTunes, the third-largest music store in the country.”

As a sign of how much digital distribution is changing the music business, this pitch has been heard by unknown bar bands but also some established artists. Today, the company is expected to announce that Public Enemy, one of the seminal hip-hop groups, will use its service for its new album, “How Do You Sell Soul to a Soulless People Who Sold Their Soul.”

TuneCore is a digital distributor that gets music into online stores, just as traditional distributors stock shelves at regular retailers. But Mr. Price (who also co-owns an independent label) does not take a percentage of sales, as most distributors do, nor does he provide the same marketing and promotional services as those companies.

Rather, he charges a flat fee: 99 cents a song as an uploading and processing fee, 99 cents for each store where the act wants to place the album, and $19.98 an album each year for storage.

Yahoo will announce new tools for online advertising today that could pull the company ahead in the race for what is called “behavioral targeting,” that is, the ability to better tailor online advertisements to the people most likely to buy.

The product, Yahoo SmartAds, would help marketers create custom advertisements on the fly, using information on individual buyers and information on real prices and availability from the vendors. For example, a person who had recently searched for information about blenders might see an ad from Target that gives the prices for the blenders that are on the shelves in the store closest to that person’s home.

The Internet has long promised this kind of one-to-one marketing, but it has often been difficult for advertisers to customize display advertisements with a broad reach.

[...] This is how Yahoo’s new system works: the advertiser (or its agency) would provide Yahoo with the components of its display ads — including the logos, tag lines and images. The retailer would share information from its inventory databases that track the items on the shelves in each of its stores. Next, Yahoo would combine that data with the information it has about its users’ demographics and actions online to create a product-specific advertisement.

The Universal Music Group of Vivendi, the world’s biggest music corporation, last week notified Apple that it will not renew its annual contract to sell music through iTunes, according to executives briefed on the issue who asked for anonymity because negotiations between the companies are confidential.

Instead, Universal said that it would market music to Apple at will, a move that could allow Universal to remove its songs from the iTunes service on short notice if the two sides do not agree on pricing or other terms in the future, these executives said.